The first class of the course will be a very big-picture overview: How are economies different across time and space? How are they organized? Can all economies be fruitfully analyzed with the tools that we use to analyze modern market economies? Or must economies elsewhere and elsewhen from the modern North Atlantic (which somehow includes Hawaii, Japan, Australia, and New Zealand) be analyzed with different tools because they follow different laws of motion and behavior? This first week will lead us into the first part of the course which will cover the long era between 8000 BC and 1800 or so during which people were very poor, populations were very slowly-growing, the pace of technological and organizational innovation was very very low by our standards, and life was typically nasty and brutish and short.
I. Pre-Industrial Economies
- Jan 20: Modes of Production
- Jan 27: Malthus and the Demographic Transition
- Feb 3: Industrious Revolutions
- Feb 10: Trade, Law, and State
The second part of the course will cover modern industrial economies: from the British Industrial Revolution up to the present day, focusing mostly on the North Atlantic but with side glances elsewhere in the world.
II. The Industrial Economic World
- Feb 17: Industrial Revolutions
- Feb 24: Globalizations
- Mar 3: Divergences
- Mar 10: WWI and the Great Depression
- Mar 17: WWII and the Thirty Glorious Years
- Mar 31: The Forward March of Social Democracy Halted?
- Apr 7: China Stands Up**
The third part of the course will take a historical look at the current financial crisis, and also at how economists have thought about financial crises for the past roughly two hundred years since the start of the industrial business cycle.
The first week of three will examine financial crises, their impact on the real economy, and economists' thoughts about financial crises and the industrial business cycle over the century between 1825 and 1914. It will thus trace both the birth of the industrial business cycle and also the birth and development of economists' thought about the industrial business cycle--that is, the birth of macroeconomics as we have known it.
The second week of three will consider the period from 1914 up through 1970 or so that spans World War I, post-WWI inflations, the Great Depression, WWII, and then the boom and inflation of the post-WWII period that catalyzed the development of the useful macroeconomics that we can use today to understand the current financial crisis, and what economic policies governments should try to cure it. The last of the three weeks on financial crises will start by looking at the history of macroeconomic thought from 1970 to 2008--a history that I think all have to admit is a somewhat sorry history, as it has left us with a discipline that is, as Narayana Kocherlakota says, of little use in helping us to understand either the cause or the development or the cure of our current macroeconomic distress. The bulk of this third class, however, will cover the cause, development, and potential cures for our current financial crisis and macroeconomic distress. I will thus break a treaty between macroeconomic theorists on the one hand and economic historians on the other by which we economic historians are supposed to keep our noses on the far side of 2000.
III. Macroeconomics in Historical Perspective
- Apr 14: Lombard Street, 1825-1914
- Apr 21: From the Great War through the Great Contraction to the Great Inflation
- Apr 28: The Panic of 2007-2010**
The last class of the semester will be a separate part for the course, a reflection and a kind of preachy summing-up.
IV. Conclusion
- May 5: Reflections
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